We all tend to perceive an “innovation gap” between Canada and leading-edge tech countries, even after years of the SR&ED program which is intended to nurture Canada’s innovative growth. That might lead some to ask the question, does SR&ED really boost Canadian innovation? Where is the money going, and could it be better directed?
A recent pan-industry study was conducted by CATA, six other major industry associations, five federal and four provincial agencies, a couple of universities and several NGOs, to try and tackle this question. What they found might surprise you. The conclusion reached is that it’s not innovation we’re missing on our shores, but commercialization of innovation.
The gist of their conclusion is that plenty of research happens in Canada, but it’s the other side of the equation, development, which all too often gets neglected. Innovators take their ideas to other places in the world for development, and those developments are considered to belong to the destination country even if Canadians did the research.
The SR&ED program provides a baseline of encouragement for Canadian businesses in a variety of industries to not only perform research in Canada, but to keep ownership of intellectual property of their findings, and thus develop the technology in Canada. There may yet be other means of improving the program or further encouraging Canadian innovators to develop at home, but for now, programs like SR&ED and IRAP are what we have to work with.